False Testimony Leads to Triple Damages Award by EDTX against Samsung

Samsung Electronics was punished with a $21 million enhanced damages award after finding egregious willful infringement of patents held by Imperium IP Holdings of the Cayman Islands.Judge Mazzant cited the US Supreme Court’s decision this June in Halo Electronics v. Pulse Electronics while making his determination to triple the damages. At Halo, the majority opinion held that the two-step Seagate test is inconsistent with § 284, which has no explicit limit or condition on when enhanced damages are appropriate. Imperium IP Holdings v. Samsung Electronics in E.D. Tex. is the first case to apply with Halo standard for awarding enhanced damages.

The original complaint was filed on June 2014 by Imperium IP seeking damages from Samsung for infringing the patents. On February 2016, the jury verdict delivered that Samsung had willfully infringed upon the following patents-in-suit:

In this case, the court decided to award enhanced damages to Samsung, because of egregious behavior on the part of Samsung, including attempts to copy the technology and moreover, false testimony given by Samsung. Samsung’s representatives testified under oath that they only became aware of Imperium IP’s patents in June 2014, the first time the infringement action was brought to court. However, this was proved incorrect by depositions and other discovery during trial. Previously, Samsung had also made an attempt to purchase the patents-in-suit from Imperium, concealing its identity through a patent broker. The court thus found that Samsung was aware of Imperium’s patents since at least April 2011 instead of June 2014.

While deciding to award enhanced damages, the court was guided by the non-exclusive factors developed by the U.S. Court of Appeals of the Federal Circuit decided in 1992. Likewise, Samsung has also made an attempt in defense to declare that it wasn’t liable for infringing on imaging sensors which it purchased from Tokyo-based Sony Corporation. During September 2015, a damages expert for Imperium deposed that the company wasn’t targeting sensors which Samsung purchased from Sony, but an infringement report on the same day which used a citation only listing Sony sensors.

Court decided that Samsung’s decision not to declare the Sony license defense until November 2015, post the deadline to file for summary judgement and months after receiving the Sony license agreement in April 2015, was evidence that Samsung vigorously intended to not assert the Sony license.

According to USPTO data and MaxVal’s own research, Imperium accused Samsung in 3 PTAB cases out of which 1 wasn’t instituted.

Petitioner demonstrates that there is a reasonable likelihood of prevailing in showing the unpatentability of claims 1, 6, 7, 14, and 16 of the ’029 patent. Consequently, we institute inter partes review of claims 1, 6, 7, 14, and 16 as unpatentable over Shimada. ORDERED that inter partes review is instituted as to claims 1, 6, 7, 14, and 16 of the ’029 patent.

Petitioner has demonstrated a reasonable likelihood that it would prevail at trial in showing the unpatentability of claims 1 and 10 of the ’290 patent on certain of the grounds asserted in the Petition. ORDERED that an inter partes review is instituted as to claims 1 and 10 of the ’290 patent.